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- Problem #2 Lump-Sum Liquidation with Loss on Realization After several years of operations, the partnership of Concepcion, Macabata and Pedroso is to be liquidated. After making closing entries on March 31, 2011 the following accounts remained open: Account Balance Account Title Debit Credit Cash P 150,000 Non-cash Assets 2,600,000 Liabilities P 750,000 Concepcion, Capital 400,000 Macabata, Capital 600,000 Pedroso, Capital 1,000,000 The non-cash assets are sold for P2,150,000. Profits and losses are shared equally. Required: Prepare a statement of partnership liquidation and the entries to record the following: 1. Sale of all non-cash assets. 2. Distribution of loss on realization to the partners. 3. Payment of the liabilities. 4. Distribution of cash to the partners.#26 Tabodi Corp. has been undergoing liquidation since January 1. As of June 30, its condensed statement of realization and liquidation is presented below: Assets realized 105,000 Interest on investment 525 Purchases 5,250 Assets acquired 17,500 Liabilities assumed 5,250 Payment expense of trustee 26,250 Liabilities to be liquidated 227,500 Sales on account 17,500 Assets not realized 147,000 Liabilities not liquidated 111,475 Sales for cash 87,500 Assets to be realized 332,500 Liabilities liquidated 122,500 The net gain(loss) on realization and liquidation is Group of answer choices (61,250) Any other amount (25,000) 61,250 25,000Partners Ong, Rodriguez, Pamittan and Reyes who share profits andlosses at 30%, 30%, 20% and 20%, respectively, decided to liquidate. Allpartnership assets are to be converted into cash. Before liquidation, thecondensed statement of financial position follows:Cash P100, 000 Liabilities P750, 000Other Assets 1, 800, 000 Rodriguez, Loan 60, 000Reyes, Loan 50, 000Ong, Capital 420, 000Rodriguez, Capital 315, 000Pamittan, Capital 205, 000Reyes, Capital 100, 000Total P1, 900,000P1, 900,000The non-cash assets realized P800, 000, resulting to a loss of P1, 000,000. All the partners are solvent, and can contribute any additional cash tocover any deficiency. In the process of liquidation, deficiencies will occur andwill require additional investment as follows:a. Pamittan at P7, 500b. Reyes at P50, 000c. Reyes and Pamittan for P50, 000 and P7, 500, respectivelyd. None
- 38. ABC partnership engaged in steel manufacturing business had the following condensed financial position prior to liquidation: (in the picture) Assuming assets with a book value of P700,000 were sold for P500,000 and that all available cash was distributed. For what amount would the remaining assets have to be sold in order for Partner BBB to receive a total of P790,000 cash after liquidation. A. P1,550,000B. P1,600,000C. P1,500,000D. P1,650,000E 17-2 Liquidation—Journal entries After closing entries were made on December 31, 2016, the ledger of Mac, Nan, and Obe contained the following balances: Cash $39,000 Accounts payable $5,000 Inventory 16,000 Mac capital (40%) 15,000 Nan capital (30%) 8,000 Obe capital (30%) 27,000 Due to unsuccessful operations, the partners decide to liquidate the business. During January some of the inventory is sold at cost for $10,000, and on January 31, 2017, all available cash is distributed. It is not known if the remaining inventory items can be sold. Required Prepare all journal entries necessary to account for the transactions of the partnership during January 2017.QUESTION 4 / Review Sunny Co purchased 20,000 shares in Peter Co on 1 August 2020 at a cost of $6.0 each. Transaction costs on the purchase amounted to $2,000. At the year-end 30 September 2021, these shares are now worth $7.50 each. What is the gain to be recognized for the year ended 30 Sep 2021 and where it will be recorded according to two cases: (1) Shares held for sales (2) Shares held to collect contractual cash flows and sell them.
- HW - Ch 20-2 Prepare journal entries to record the effects on Shannon’s accounting records at December 31, 2021, for each of the items described above. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in whole dollars not in thousands of dollars.) (1) Record the gain on sale of investment with an original cost of $186,000 for $232,000 (2) Record the adjustment of equity securities for the investment of $232,000 as on the date of sale. (3) Record the fair value adjustment. (4) Record the loss-lawsuit. (5) Record correction of inventory error. (6) Record correct assets that were incorrectly expensed. (7) Record the 2021 adjusting entry for depreciation. (8) Record the income tax expense.Partners A,B and C decided to liquidate their business on January 31, 2021 and showed the following financial position: ASSETS LIABILITIES & STOCKHOLDER'S EQUITY Cash 28,000 Accounts Payable 14,400 Non-Cash Assets 36,000 Loan Payable to A 4,000 A, Capital 8,000 B, Capital 16,000 C, Capital 21,600 Totals 64,000 Totals 64,000 It was also agreed that cash distribution be made at the end of each month provided there was sufficient cash for this purpose. Profit and loss ratio was 2:1:2 respectively. The liquidation transactions for the months of February, March and April were as Follows: Cash Proceeds BV of Assets Sold Liabilities paid Liquidation Expense Restricted Cash for future expenses February 8,000 12,000 12,000 2,400 1,600 March 12,800 16,000…Partners A,B and C decided to liquidate their business on January 31, 2021 and showed the following financial position: ASSETS LIABILITIES & STOCKHOLDER'S EQUITY Cash 28,000 Accounts Payable 14,400 Non-Cash Assets 36,000 Loan Payable to A 4,000 A, Capital 8,000 B, Capital 16,000 C, Capital 21,600 Totals 64,000 Totals 64,000 It was also agreed that cash distribution be made at the end of each month provided there was sufficient cash for this purpose. Profit and loss ratio was 2:1:2 respectively. The liquidation transactions for the months of February, March and April were as Follows: Cash Proceeds BV of Assets Sold Liabilities paid Liquidation Expense Restricted Cash for future expenses February 8,000 12,000 12,000 2,400 1,600 March 12,800 16,000…
- Q1. The trial balance of the partnership of Woods Brothers trading as Woods Hardware as at 21 June 2010 disclosed: Inventory $145,000 Accounts receivable 225,000 Land at cost 50,000 Buildings at cost 80,000 Accumulated depreciation -buildings $ 20,000 Fittings and equipment 60,000 Accumulated depreciation -fittings and equipment 25,000 Motor vehicles 40,000 Accumulated depreciation - motor vehicles 24,000 Accounts payable 181,000 Bank overdraft 100,000 Capital - John Woods 125,000 Capital - Thomas Woods 125,000 600,000 600,000 At that date Woods Industries Ltd was incorporated to acquire Woods Hardware as a going concern for a purchase consideration of $500,000. The purchase consideration was settled by the issue of fully paid ordinary shares. The fair value of the assets acquired is: Land $ 300,000 Buildings 170,000…PROBLEM: The creditors of the RR Corp. agreed to a liquidation based on the statement of affairs, suggested that unsecured creditors, without priority would receive approximately P.60 on the peso. The unsecured creditors are interested in determining whether the preliminary estimate still seems appropriate. The trustee was originally assigned noncash asset for P1,480,000 and creditor claims as follows: Fully secured P670,000 Partially secured P400,000 Unsecured with priority P200,000 Unsecured without priority P320,000 Assets with book value of P45,000 and unsecured liabilities, without priority, of P35,000 were subsequently discovered. Assets with a total book value of P740,000 were sold for P715,000 net. Fully secured liabilities of P410,000 and partially secured liabilities of P280,000 were paid. Remaining liquidation expenses were estimated to be P30,000. Assume the remaining noncash assets have an estimated net realizable value as follows: Assets traceable to…Instagram Corporation has been undergoing liquidation since January 1. As of March 31, its condensed statement of realization and liquidation is presented below:Assets:Assets to be realized P 135,000Assets acquired 750,000Assets realized 1,200,000Assets not realized 1,375,000Liabilities:Liabilities Liquidated P 1,875,000Liabilities not liquidated 1,700,000Liabilities to be liquidated 2,250,000Liabilities assumed 1,625,000Revenues and Expenses:Supplementary Charges P 3,125,000Supplementary Credits 2,800,000The net gain (loss) for the three-month period ending March 31 is:a. P250,000b. P(325,000)c. P425,000d. P750,000
